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Benjamin

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  1. Background for Question: An IDIQ contract was awarded that includes a Base Year and two Option Years. Per contract stipulation A.5 MINIMUM/MAXIMUM CONTRACT AMOUNTS sub a.: "During the ordering period specified in the Ordering Clause (FAR 52.216.18), the Government will place orders totaling a minimum of $20,000.00." Per contract stipulation B.2.2 52.216.18 Ordering. (OCT 1995) (Applies to IDIQ CLIN ONLY) (a) Supplies and services under this contract shall be ordered by issuance of delivery orders or task orders by the individuals or activities designated in the Schedule. Such orders may be issued from contract award through the end of the effective period. (b) All delivery orders or task orders are subject to the terms and conditions of this contract. In the event of conflict between a delivery order or task order and this contract, the contract shall control. (c) If mailed, a delivery order or task order is "issued" when the Government deposits the order in the mail. Orders may be issued orally, by facsimile, or by electronic commerce methods only if authorized in the Schedule. Per A.6 PERIOD OF PERFORMANCE The period of performance is from date of award through 12 consecutive months. The contract may be extended by exercising options for two additional twelve month periods. Base Year: 9/10/2012-9/9/2013 Option Year 1: 9/10/2013-9/9/2014 Option Year 2: 9/10/2014-9/9/2015 Per Solicitation/Contract/Order for Commercial Items awarded 9/10/2012, Box 19 Item No. shows 1 Box 20 Schedule of Supplies/Services shows TIN DUNS IDIQ Name Period of Performance: 9/10/2012 to 9/9/2015 Item No. 1 - Line Item to Fund Task Orders: $500,000.00 The total amount of award: $500,000.00. The obligation for this award is shown in box 26. Box 26 Total Award Amount: $0.00. Per the modification of contract, effective date 9/14/2013, Box 13 D Other: FAR 52.217-9, "Option to Extend the Term of the Contract" Box 14 Description of Modification: TIN DUNS The purpose of the unilateral modification is to 1) Exercise Option Year 1 under this Task Order. Accordingly: 1) The Government exercises its right to exercise an option in accordance with the contract's clause FAR 52.217-9, "Option to Extend the Term of the Contract", which thereforce updates the period of performance for this Task Order. 2) As a result of the exercise of this option, the total task order value is hereby increased: From: $42,709.92 By: $43,564.12 To: $86,274.04 Monthly Payments - $3,630.34 The new task order period of performance has hereby been extended as follows: From: 9/14/2012-9/13/2013 To: 9/14/2013-9/13/2014 Delivery: 8/15/2013 Delivery location Payment Add Item 2 as follows Item No. 2 - Exercise Option Year for IDIQ Amount 43,564.12 During the Base Year, six orders were placed and invoiced against, totaling $17,795.80 (cumulative). During Option Year One (contract modified to exercise the option effective 9/14/2013), zero orders were placed and invoiced against, totaling $0 cumulative. Option Year Two was not exercised. Question: While all of the orders have been paid in full, they total less than the minimum delivery orders. For IDIQ Base Year, ordering resulted in invoices totaling $17,795.80, which is $2,204.20 below the $20,000 minimum delivery order threshold. For IDIQ Option Year One, ordering resulted in invoices totaling $0, which is $20,000 below the $20,000 minimum delivery order threshold. In order to close-out this contract per the fully executed terms, isn't the minimum delivery order applied to each CLIN (per 52.216.18)? In other words, CLIN 1 establishes the Base Year as an ordering period and CLIN 2 establishes a second ordering period for Option Year One? It seems there is an interpretation issue with the ordering period, the Schedule, the effective period, and the Period of Performance.
  2. Minimum Delivery Order

    All the orders were FFP, not T&M or labor-hour. No performance issues occurred that affected the order prices. The total amount ordered (and invoiced against) was 10 units, which amount to $17,795.80. Sorry, I thought it was reasonable to cite dollar figures because that is what the ordering clause explicitly references re: minimum/maximum - not min/max units. "The Government will place orders totaling a minimum of $20,000.00."
  3. Minimum Delivery Order

    Thank you, Vern- the amount invoiced is being cited as relevant to the contract stipulation "A.5 MINIMUM/MAXIMUM CONTRACT AMOUNTS...the Government will place orders totaling a minimum of $20,000.00." The number of orders is not what is at issue, because each order was not priced the same, and a variable number of orders could reach minimum/maximum contract amounts. The thread Don linked to speaks more to what I'm concerned with: 1) the contract references a minimum amount ($20,000) during the ordering period specified in the Ordering Clause (FAR 52.216.18) 2) the ordering period is not explicitly specified in 52.216.18 Ordering, providing dates for orders that may be issued; instead it states that "orders may be issued from contract award through the end of the effective period" 3) The effective period is not explicitly specified anywhere in the contract or in the subsequent modification to exercise the option 4) Curiously, 52.216.18 Ordering adds a parenthetical to its header "(APPLIES TO IDIQ CLIN ONLY)"; however, there is one CLIN for the Base Year and when the mod came forward to exercise Option Year One, a second CLIN was added to the IDIQ. Presumably a third CLIN would have been added to the IDIQ if Option Year Two was exercised. Notwithstanding Vern's citations of both regulation and case law affirming that options are part of the overall contract, for this contract, what exactly is the ordering period, and what exactly is the effective period? Isn't this subject to interpretation if dates are not provided in 52.216.18? Given that the contract appears to be written in such a way that they are treated as one and the same, is it enough to imply that the ordering period and effective period cover the full Period of Performance on a Base + Options IDIQ? If it is, why have option years at all - why not let a 3-year IDIQ and just stop ordering when satisfied and when reaching the minimum for the single 3-year ordering period? Wouldn't it be fair to imply that including options on this IDIQ was in part to exercise new ordering periods? Especially if applying a new CLIN to the IDIQ in the mod (recalling that the ordering period references CLIN)?
  4. Minimum Delivery Order

    Yes, correct. "52.216.18 ORDERING. (OCT 1995) (APPLIES TO IDIQ CLIN ONLY)". The contract established CLIN 1 to fund task orders. The contract modification added CLIN 2 to exercise option year one for new IDIQ amount. In this case, does the addition of a CLIN establish another/separate ordering period?
  5. Minimum Delivery Order

    Because 52.216.18 says ordering applies to the IDIQ CLIN. And there are two CLINs - one for the base year and another for the option year. In addition, there appears to be a point of interpretation in how 52.216.18 references "effective period", as it relates to the minimum delivery "ordering period" and the "period of performance". Just because the period of performance can be extended through options, my interpretation is that that does not necessarily extend the ordering period (to the whole life of the contract); rather, extending the period of performance through options could also mean that the contract is establishing another ordering period (as assigned by the new CLIN).
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